April 2, 2004
By Thomas Thale
RATEPAYERS, take heart. Your bills are not about to increase dramatically as a result of the new Property Rates Bill!
This reassuring message was delivered by Parks Tau, the councillor responsible for finance, strategy and economic development in the city.
"There will be no drastic increases in rates; certainly not," said Tau, addressing the implications of the newly promulgated legislation for ratepayers in Johannesburg.
Although the legislation takes effect from July, it will be a while before systems are put in place to implement its provisions.
The new bill will overhaul the manner in which properties have been valued up to now. Whereas in the past, property values in the city were based on the valuation of land only, the bill provides for municipalities to value both land and buildings in order to rate property.
"But rates will not necessarily increase," said Tau. Before the provisions of the bill are implemented, the city will have to draft a policy to determine a new system of rates. "We could reduce the rate in the Rand to mitigate the effect of increased property values," said Tau. "Our objective is not to raise more money."
The city will also have to formulate a new rebate structure as the current system of granting home-owners a 58 percent rebate on their property could be rendered obsolete by the new legislation. Rebates are based on the value of property and the number of dwellings on it. Home-owners with houses valued at R20 000 or less, get a 100 percent rebate.
In formulating new policies on rates and rebates, the city would first have to assess their impact on the city and on residents in terms of the new definition of land use rights, said Tau.
Tau anticipates that the new rates policy will only take effect after the next financial year, which ends in June 2005. This is partly because the process of formulating public policy could be lengthy as it includes public participation.
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